Risks, liabilities, scams from Thai condominium ownership?

[pbrock]

What are the risks and liabilities that can come from being the owner of a condominium?

 

The price is really cheap. I guess there might be a reason for that. The seller is a bank. There are different risks during purchase (such as buying leasehold, getting not buying property at all, or buying in someone else's name) but that's a different topic for a different place. Please let me know the risks after a successful purchase of a freehold condominium as a foreigner in Thailand. You might not be able to find a tenant obviously. Rental income might be low. Let's ignore that too. Re-sale might only be possible with a loss. I saw reports of difficulties getting money from re-sale out of the country. Let's ignore that too. More interesting, what am I missing?

 

What are the abilities of the condominium management to scam? Over charge foreigners with condominium management fee? Happening?

The condominium general meeting is might not be of any help either? Majority is Thai. As I've observed in other places, many owners do not participate in the condominium general meeting. Kinda similar to a democracy. Many people don't pay attention, observe, join any meetings and votes they are entitled to.

 

The condominium general meeting, if it's not a foreigner focused, good reputation condominium management speaking Thai with the majority of documents in Thai?

 

Condominium management going bankrupt or misappropriation of funds?

 

Does it happen that they claim "this and this pipe / cable / whatsoever is broken. To fix it costs 2 million THB. While in actuality repair is much cheaper. Just as a scheme to milk farangs. Happening in reality or imagination?

[scubascuba3]

Common fees (maintenance) can be higher than expected, not uncommon that you pay the specified common fees to find out there are supplementary/emergency fees to pay due to a shortfall. 

Condo office may not get sufficient quotes for work  and maybe bungs included. It's up to the committee to sort that out but some are weak

[Peterw42]

OP. you can get a lot of the answers to your questions by having a good look around the block you are considering buying in. If its in good repair, things are not broken , the security asks who you are when you enter, there isnt a broken down noodle cart in the car park. All indications of a well managed block. Condition of the block will usually tell you everything.

Condo fees are fixed per metre per month, so there is not any charging westerners more etc.

The biggest problem isnt often overcharging, its often under charging. Older block the fees were set years ago and have never been increased. There is not enough money for maintenance or repairs.

There are checks and balances in a well run condo block, multiple quotes for jobs, the committee signs off on expenditure etc

 

If you are buying in to a new build block in somewhere like Pattaya, Nowadays the blocks often have private companies (recommended) that run the block (costs more but the blocks are run well with no corruption, maintenance schedules, ongoing improvements) . Condo meetings will be in Thai and English, announcements and newsletter in Thai and English..

 

The worst blocks you can buy into are older and smaller blocks, as above, older blocks often dont have enough money coming in, Smaller blocks that dont have an office or dedicated staff, the committee ends up running the whole show and can create their own little cartel.

[nobodysfriend]

On 11/13/2020 at 5:05 PM, pbrock said:

The price is really cheap

 Normally there is a ( bad ) reason for that .

Check it out ...

If you invest , count what you could get as a return of your investment .

Don't forget hidden fees like costs for renovation etc .

If the neighborhood is not good , better don't ...

[tomazbodner]

1 hour ago, nobodysfriend said:

 Normally there is a ( bad ) reason for that .

Check it out ...

If you invest , count what you could get as a return of your investment .

Don't forget hidden fees like costs for renovation etc .

If the neighborhood is not good , better don't ...

Not necessarily. COVID had its effect. Many developers are trying to close off the projects at up to 50% discounts on their opening prices, infuriating owners who bought at "best price" at project launch. I know a few such places from Ananda, AP, Origin, SC Capital and Sansiri, Major Development and many more from Pruksa, that are down 45-50%, even at high end projects in the middle of the city and their 11/11 sale is literally half of what "Starting From" on the billboards in front of their buildings say.

 

Example:

 

 

[TimBKK]

13 hours ago, tomazbodner said:

Not necessarily. COVID had its effect. Many developers are trying to close off the projects at up to 50% discounts on their opening prices, infuriating owners who bought at "best price" at project launch. I know a few such places from Ananda, AP, Origin, SC Capital and Sansiri, Major Development and many more from Pruksa, that are down 45-50%, even at high end projects in the middle of the city and their 11/11 sale is literally half of what "Starting From" on the billboards in front of their buildings say.

 

Example:

 

 

“secret deal” ????

 

[Jingthing]

One word -- assessments.

The regular monthly fees may not (probably won't) cover all that is needed.

So assessments could be "special" (need a major repair to the building) or basically predictable.

Nothing to do with whether you're a foreigner or not.

Similar risk in owning a condo in the U.S. which is the only other country I have experience of.

Could easily wipe out any "gains" from a low rent. 

 

But bottom line is that I really wouldn't recommend buying a condo in Thailand because owning a condo in Thailand doesn't guarantee you can live in the condo in Thailand and good luck managing a rental long term from abroad. 

[Airalee]

21 hours ago, tomazbodner said:

Not necessarily. COVID had its effect. Many developers are trying to close off the projects at up to 50% discounts on their opening prices, infuriating owners who bought at "best price" at project launch. I know a few such places from Ananda, AP, Origin, SC Capital and Sansiri, Major Development and many more from Pruksa, that are down 45-50%, even at high end projects in the middle of the city and their 11/11 sale is literally half of what "Starting From" on the billboards in front of their buildings say.

 

Example:

 

 

The 50% off price is off the dream price that the developers put in front of their building to keep the people who bought presale happy and thinking they got a good deal.  I highly doubt that many people ever pay those prices.  Subsequently, the deals that you see listed, although less (and sometimes substantially less) than what you see people trying to resell their units for are not quite the bargains that they appear to be.  They also tend to be the less desirable condos from a developers portfolio (of buildings and units within said building)

 

Let’s use Reflection as an example.  Looks like a nice building, but the room code numbers suggest that those are second and third floor units in a 2 building 50 story beachfront complex.  I suspect, but cannot be sure, that those units have no views.  Also, when I look at the google street view there, although they are in Jomtien, they appear to be far from pretty much everything...like being in the exurbs where a huh rise building is plopped down in the middle of nowhere.  There are a few of those sort of buildings in Thailand in places such as Rayong, Cha-am, and south of Huahin.  You could cut those prices in half again and I still wouldn’t want one.

 

Same goes for the building near Chatuchak.  What’s out there other than Chatuchak market?  Sure, it’s a good place to go to furnish your new condo with whatever bric-a-brac you want to fill it with but beyond that, once again..it’s the exurbs.  Too far out.

 

I’m certainly not saying that condos in better locations are faring much better, and they are still drastically overpriced for many of them.  

 

No matter what anybody says, I don’t see how this market was ever able to support thousands of 15 million baht (and higher) one bedroom condos and 30 million+ baht 2 bedroom units.  There just aren’t that many wealthy people around.  Of course, someone will come in and say that they know a rich Thai person who owns dozens of them and just sit on them not renting them out (sure they do), or that the newly minted Chinese millionaires will be lined up to buy them...but if that was true...and not someone trying to talk up the value of their own overpriced condo purchase...those condos would already be in the hands of rich Thais and Chinese and not still for sale years after building completions and long before COVID started.